Investors caught up in the gyrations of currency markets cannot say they were not warned. For months pundits have signalled the possible unwinding of carry trades – where money borrowed in currencies with low interest rates is invested in those offering higher ones. Does the jump in the yen over the past week mark the end for the carry trade?

As expected, positions have reversed with a snap. In the past five days, the yen has leapt 7 per cent against the South African rand and 5 per cent versus the Australian dollar, two popular carry trade currencies. Last Tuesday, trades on electronic brokerage systems totalled $266bn – double the average daily value.